These FAQs attempt to put in place the common queries that users have on the subject in easy to understand language. However, for conducting a transaction, the Foreign Exchange Management Act, 1999 (FEMA) and the regulations made or directions issued thereunder may be referred to. The relevant principal regulations are the Foreign Exchange Management (Acquisition and transfer of immovable property in India) Regulations, 2000 issued vide Notification No. FEMA 21/2000-RB dated May 3, 2000. The directions issued are consolidated in Part II of the Master Direction No 12 on Acquisition and Transfer of Immovable Property under Foreign Exchange Management Act, 1999. Amendments, if any, to the principal regulations are appended.
Payment for immovable property has to be received in India and is subject to payment of all taxes and other duties/ levies in India. The payment should be received in the form of funds remitted to India through banking channels or through funds held in NRE/ FCNR(B)/ NRO accounts of the NRIs/ PIOs. Payments should not be made through travellers’ cheque and foreign currency notes. NRIs/ PIOs can avail of housing loan in Rupees from an Authorized Dealer or housing finance Institution in India subject to conditions.
Foreign Embassy/ Diplomat/ Consulate General, can purchase/ sell immovable property (other than agricultural land/ plantation property/ farm house) in India provided –
|Purchase (other than agricultural land/ farmhouse/ plantation etc) from||Resident/ NRI||Resident/ NRI|
|Acquire as gift (other than agricultural land/ farmhouse/ plantation etc) from||Resident / NRI/ PIO||Resident/ NRI/ PIO|
|Acquire (any IP) as inheritance from||(a) Any person who has acquired it under laws in force |
(b) under section 6(5)iii of FEMA
|Sell (other than agricultural land/ farmhouse/ plantation etc) to||Resident / NRI/ PIO||Resident|
|Sell (agricultural land) to||Resident||Resident who is a citizen of India|
|Gift (other than agricultural land) to||Resident / NRI/ PIO||Resident / NRI/ PIO|
|Gift (agricultural land) to||Resident||Resident who is a citizen of India|
|Gift residential/ commercial property to||Resident / NRI/ PIO||Resident / NRI/ PIO|
A person who has acquired the property U/s 6(5) of FEMA or his successor cannot repatriate the sale proceeds of such property without RBI approval. However, repatriation up to USD I million per financial year is allowed, along with other assets under (Foreign Exchange Management (Remittance of Assets) Regulations, 2016) for NRIs/ PIOs and a foreign citizen (except Nepal/ Bhutan/ PIO) who has (a) inherited from a person referred to in section 6(5) of FEMA, or (b) retired from employment in India or(c) is a non-resident widow/ widower and has inherited assets from her/ his deceased spouse who was an Indian national resident in India. NRIs/ PIOs can remit the sale proceeds of immovable property (other than agricultural land/ farm house/ plantation property) in India subject to the following conditions:
As per section 2(ze) of FEMA transfer means, sale, purchase, exchange, mortgage, pledge, gift, loan or any other form of transfer of right, title, possession or lien.
1. Notification No. FEMA 65/2002-RB dated June 29, 2002
2. Notification No. FEMA 93/2003-RB dated June 9, 2003 3. Notification No. FEMA 146/2006-RB dated February 10, 2006 4. Notification No. FEMA 186/2009-RB dated February 3, 2009 5. Notification No. FEMA 200/2009-RB dated October 5, 2009 6. Notification No. FEMA 321/2014-RB dated September 26, 2014 7. Notification No. FEMA 335/2015-RB dated February 4, 2015